Free Trade Good or Bad? Trump's Amazing Impact on Republicans and Democrats

The shift of Democrats towards supporting free trade, and Republicans the opposite is a sight to behold. Blame Trump.

Historically opposed to free trade, Democrats increasingly identify with values like openness to trade. Republicans have done the opposite as noted by Greg Ip in the Wall Street Journal.

Since the 1940s, Republicans have branded themselves the party free trade, while Democrats—especially rank and file officials and congressmen—have more often been the party of protection. Those labels need updating. Mr. Trump’s imposition of tariffs on allies and adversaries alike is accelerating a migration of Democratic voters toward free trade and Republicans away from it. Among elected legislators, the median Republican is still pro-free trade and the median Democrat a skeptic, but those lines, too, are shifting.

The divide is also cultural: Democrats increasingly identify with cosmopolitan values like openness to trade, immigration and culture. For some, Mr. Trump’s dislike of free trade only makes it more appealing.

Free trade has yet to convert the bulk of elected Democrats, especially those in traditional rust-belt regions. Sen. Sherrod Brown (D., Ohio), a longtime skeptic of free trade, has allied himself with Mr. Trump on tariffs and stopped a tougher version of Mr. Corker’s proposal from getting a vote. Conor Lamb wrested a Pittsburgh-area district away from Republicans in a special election in part by endorsing Mr. Trump’s steel tariffs.

And the party’s rising progressive left instinctively equates trade deals with giveaways to corporations and the rich. In 2016 Hillary Clinton recanted her support for the Trans-Pacific Partnership, an ambitious 12-nation trade pact, under pressure from Sen. Bernie Sanders (I., Vt.), a self-described democratic socialist.

All this means that a Democratic-controlled Congress, traditionally hostile territory for free-trade legislation, may be friendlier now. Democrats may see countering tariffs and protecting trade pacts as politically useful not for its own sake but as a way of constraining Mr. Trump.

Ip Misses the Mark

Greg IP is my favorite WSJ writer. But I believe he misses the mark on this one. Just imagine, Bernie Sanders, a staunch opponent of Free Trade had won the election.

All of the republican writers and outlets that changed their tune to back their party would be attacking Sanders like mad.

There is some truth to Ip's analysis but I propose something far more basic is behind the shift.

People Can't Think

People cannot think on their own. They listen to Right-wing or Left-wing commentary bashing or loving the policies of the current president wants on a purely partisan basis.

That's what the lead-in image says to me.

Mike "Mish" Shedlock

Comments (20)
No. 1-20
thimk
thimk

the Repub sentiment change is disheartening. No party wants to address the root causes . Much of the current account deficit is due to government deficit spending and tax code that favors off shoring. Time for a third party. Tariffs are a extend and pretend solution.

AlexSpencer
AlexSpencer

Obama competently executed policy quite similar to Bush in foreign policy (continued war) , healthcare (Bush medicare D and Obama ACA), taxes (Bush tax cut and Obama SS tax cut) and in general, traditional borrow and spend. Never understood the strong complaints . I was hoping at least for a clean out of the financial system regulators which I didn't get. With Trump the Republican/Democrat labels are now entirely meaningless. Media on both sides are continuing to pretend to see a difference.

pgp
pgp

Free trade goes hand in hand with gold standards, global equality and sustainability. In other words the place of dreams, or maybe a future a century from now, risen from the ashes of this one. A new democracy with the memory and understanding of what not to do.

MorrisWR
MorrisWR

Pretty much what I have been saying. Pundits whine and discuss free trade but free trade is a unicorn, never to be seen. Perhaps freer trade can occur but countries will never do what Mish says and drop all tariffs. I would like to see the US do it but do not see it happening before I am dead and gone.

Thalamus
Thalamus

Trump is Fair Trade, not Free Trade. When one party is taken advantage of (the US) then Free Trade doesn’t work, except for tthe globalists who play all sides. Trade should be free but fair. The socialist narrative is always just Free trade for the simple sheep so they won’t protest being the patsy.

KidHorn
KidHorn

Dems and Pubs are always mirror images of each other. Whatever party is in power pushes their legislation and the other side is always opposed to it. Rarely, both sides will agree if being against the legislation is suicide.

ChuckBlack
ChuckBlack

What many refer to as free trade is nothing of the sort. Most of it is crony-trade and highly regulated and manipulated trade., favoring some, disfavoring others.

Carl_R
Carl_R

What people don't realize is the cost of free trade. The cost is being able to buy things for a fraction of what it would cost if made in America. A vacuum provides a good example. You can buy a nice vacuum for $150 today. I remember paying $450 in 1990, which would be about $850 today. Clothes are another item that has dropped tremendously in price. Are people who are opposed to free trade prepared to accept the huge drop in their standard of living that will accompany reducing trade?

pi314
pi314

@Carl_R, you are assuming that there is no productivity gain. This is not true. An example would be cars built in the US. Even McDonalds is keeping prices low.

EndOFBabylon
EndOFBabylon

Mish keeps up the left/right diatribe...Us vs Dem...As the Old world Order re-brands itself (sans the NWO BS...its the same system), The scales are coming off the eyes of a few, and Trade should be the TOPIC DU JOUR. Everything else revolves around and is tied to TRADE, immigration, jobs, etc. Anti Christ Trump is just a hiccup in the scheme of things, a symptom rather than a cure. As the west DECLINES, we see more of these hiccups occuring vis a vis immigration and nationalism. Libertarianism, whatever you call it is on the decline. MISH knows this...yet he keeps up his libertarian tropes to the delight of his followers.

Kinuachdrach
Kinuachdrach

Definitions matter. "Free Trade" means different things to different people. It is nonsense to call the status quo ante "free trade" -- with China and the EU benefitting from protectionist tariffs and massive non-tariff barriers to trade. Most of us are in favor of true reciprocal free trade -- but we have never had it.

EndOFBabylon
EndOFBabylon

@Thalamus ..."Trump is fair trade". HA...interesting. Please note the anecdotal example of Anti Christ Trump engaging in FAIR TRADE with anyone...As long as there is a favorable deal to be made, Trump is for it. When is trade ever fair? Remember the Opium Wars? Gun Boat Diplomacy? The Old Silk Road? ...Hows that winning working out for YOU? Isnt that all tha matters...YOU?

douglascarey
douglascarey

Mish is right. It's people being blind sheep and having blind allegiances. Pathetic. Also, Trump is a third party. He's neither Republican nor Democrat. He has some Libertarian impulses combined with economic ignorance on free trade. But he's still way, way better than either Bush and of course any democrat.

JonSellers
JonSellers

Took some corporate marketing classes years ago and here is some of the proffered knowledge:

People's belief systems are based on their personal values, not tangible scientific data: i.e. I value my faith, therefore same sex marriage should be illegal. I value my liberty, therefore we should have a gold standard.

People are attracted to other people who share their value/belief systems and information that reinforces those systems. People will explore ideas from others if said others share some common values. i.e. we are both very patriotic and you are deeply opposed to removing confederate monuments. I am willing and interested in entertaining your beliefs on this subject.

The point of the marketing class is to determine someone's values, act like you share them to win their trust, then they can trust you to listen to your sales pitch.

Knowing this, you can understand Trump and the chart. Working class, conservative, generally white, religious, patriotic Americans are hurting. The stuff they value has been decimated. Making things has been off shored or is being handed to illegal immigrants, homosexuals are being treated like heterosexuals regardless of what the Bible says, the US military can't ever seem to actually win anything.

Trump has very, very loudly and boisterously said "I share your values". I want you to have a good, solid job with a pension. I want our country to follow Biblical precepts. I want American troops to win quickly and heroically and then come home for good.

And to get there, we need to end free trade. And those folks are happily buying what he is selling. And those with other value systems are moving in the opposite direction.

Sechel
Sechel

The country has largely moved against free trade. Hillary Clinton herself saw TPP as a political loser and withdrew her support even though she worked to get it done

Stuki
Stuki

My zipcode "is taken advantage of" by the dollar store half a mile over. "We" should all force ourselves to pay more money for the goods they sell there. With the proceeds going to lobbyists, and to building bomb craters in random places inhabited by hobgoblins.

Stuki
Stuki

Free Trade is simply an inevitable and necessary facet of freedom. If people are free, they are, per definition, free to choose who to sell to and buy from. And marry. And screw. And hire and fire.

As soon as some goon army starts pointing guns at you, in order to force you to buy from, sell to, marry and hire their favorite lobbyists' friends and family, you are no longer free. And instead just a peon, existing for no other reason than being livestock for some tax feeders and their circle of privileged hangers on.

Stuki
Stuki

Not one person in neither China nor the EU benefits from paying more for the same thing. Just doesn't happen. Cheaper is always and everywhere better. For all things, all the time. Obtaining more for less, will never be bad. Not even in some alternate universe that my one day be discovered. Certainly not in China nor the EU.

Just like in the US, there are people there who benefits from having a goon army stick guns in the face of their countrymen, in order to force them to overpay for the shoddier, less efficiently produced, products made by the goon army's favored incompetents. Having goons rob others on your behalf, can be quite lucrative, after all.

For everyone not on the "most favored recipient of loot" list, higher prices are nothing but a negative, however. Even in the instant.

And over time, since by far most of the growth in an economy, is created at the leading edge; by coming up with new stuff, or new, more efficient processes for obtaining existing stuff; rather than by simply doing the same old commoditized task over and over again; increasing costs for the companies, industries and individuals operating at the leading edge, is a surefire way to kill off whatever little may still be left of golden goose inherited from back when freedom still meant something.

American companies systematically being forced to pay more for inputs than foreign competition, is a surefire way to ensure they will become/remain permanent underperformers. With all the negatives this entails, for what they can afford to pay in salaries/benefits.

In practice, a tarriff "protected" US will end up like Argentina, who was once the richest country in the world, but who, like most of Latin America at the time, fell for the "import substitution" nonsense peddled by pseudo-"economist" hacks and Trump like Caudillos; rather than like the Asian tigers who embraced openness and competition: They still have some industry, generally stuck in the 50s and 60s, but there is virtually no innovation. They have "jobs," being paid low wages to perform commodity work as part of processes where by far most of the value is added in less closed societies abroad. While the wealthy remain protected, since wealth does not have to be earned, but is rather a result of government licences to own and operate the outdated factories that are protected from more efficient competition, so they can sit back and enjoy overcharging their countrymen to their hearts content. While pretending to be "pillars of the community", "job creators", "business men", "visionaries," or whatever other nonsense soothes their incompetent, fragile egos at any given time. Just like their US counterparts in similarly protected "industries": Finance, real estate, law, insurance etc.

LouisM
LouisM

I don't for a minute think that Republicans/Conservatives have shifted against free trade nor do I think that demanding 2% GDP for NATO and renegotiating trade treaties means republicans/conservatives are opposed to free trade. The former Clinton, Bush and Obama Administrations gave away US jobs and gave preferential treatment on trade in exchange for maintaining US hegemony and leadership. All this Trump hullabaloo is nothing more than an attempt at rebalancing trade with the priority being given to US jobs and trade rather than US hegemony and leadership.

Blacklisted
Blacklisted

Nothing is free, especially trade negotiated by lying, self-interest politicians.